Institution: Investors view emerging markets differently based on the impact of the Middle East conflict.

Federated Hermes' Emerging Market Debt Senior Fund Manager Mohammed Elmi stated in a report that when the Middle East conflict began, emerging market bonds were under pressure, but as the situation evolved, it has become more nuanced. He said, "The market now more clearly distinguishes between countries being positively and negatively impacted by the changing environment." Oil exporting countries outside the direct conflict zone, particularly benefit from the rise in energy prices, while oil net importing countries such as Indonesia and Turkey face issues with rising import costs. He said, "We currently favor high-yield bonds in emerging markets, especially in so-called frontier markets." He specifically mentioned that countries like the Ivory Coast, Ghana, Pakistan, and Sri Lanka are particularly attractive. He said that these countries have relatively high yields and improving fundamental credit indicators.